Henderson talks auto, residence insurance coverage at Chamber lunch

Louisiana is making progress towards controlling residence insurance coverage premiums, however auto insurance coverage protection is proving to be a more durable problem.
That was the phrase Wednesday from Deputy Insurance coverage Commissioner Ron C. Henderson, a Charenton native who has household in Morgan Metropolis, at a St. Mary Chamber Enterprise Luncheon on the Petroleum Membership.
Hurricane-prone Louisiana, particularly after a sequence of direct hits by main storms starting in 2020, is paying residence insurance coverage premiums 5% larger than the nationwide common, in line with the Financial institution Fee web site. However think about will increase anticipated due to Threat Score 2.0 and the rising value of flood insurance coverage, and the scenario is worse than the numbers point out.
And auto premiums for full protection, usually required for a brand new automobile mortgage, are a 3rd larger in Louisiana than the nationwide common, additionally in line with Financial institution Fee.
The chance for householders isn’t nearly premiums. Henderson mentioned the state misplaced 45 residence insurers in recent times. That features 10 that went out of enterprise and 30 that stopped writing insurance coverage right here.
That places upward stress on premiums as a result of it reduces competitors, Henderson mentioned.
“In case you have one loaf of bread on the shelf, what’s that going to value?” Henderson mentioned. “Regardless of the heck they need.”
However 10 extra firms have determined to put in writing insurance coverage right here throughout the final 12 months. Premiums that had been going up by 16-17% in 2023-24 went up solely 3-6% final 12 months, Henderson mentioned.
He credited the acquisition of the ten new insurers to final 12 months’s repeal of the so-called three-year rule. That rule prohibited firms from elevating deductibles or canceling insurance policies that had been in impact for 3 years.
The modified rule permits firms to cancel as much as 5% of their prospects. However Henderson mentioned firms taking such motion are required to file a plan.
“We haven’t seen a plan but from any firm,” Henderson mentioned.
One remaining thorn is Threat Score 2.0, a comparatively new system during which flood insurance coverage threat is assessed based mostly on the traits of particular person properties, not on bigger areas similar to ZIP codes.
The phrase from the Federal Emergency Administration Company is that the majority householders are seeing their premiums keep the identical or go down. However 30% are seeing will increase, typically large will increase.
Henderson mentioned his workplace has been making an attempt to pay money for the method FEMA makes use of to evaluate the danger for particular person properties. However FEMA is withholding the method, citing its proprietary nature, Henderson mentioned.
Henderson’s boss, Insurance coverage Commissioner Tim Temple, has been concerned in some high-profile disputes with Gov. Jeff Landry over strategies for lowering auto insurance coverage premiums.
Temple has disagreed with Landry proposals similar to giving the commissioner the ability to reject premium will increase seen as extreme. Temple says he already has the ability he wants.
They’ve additionally disagreed over Landry proposals similar to capping lawyer charges and limiting injury awards.
However when he opened this 12 months’s legislative session, Landry talked concerning the want for each trial attorneys and insurance coverage firms to bear a number of the ache. And there appears to be settlement on that time.
“It’s not simply the attorneys,” Henderson mentioned. “It’s not simply the businesses. It’s the entire ecosystem.”